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Labor intensive

High % of expenses are in wages

High Wage

measured in $ not %

cottage industries

work done at home

cheap labor > transportation

Site Factor: Land

back: factories in cities. Built up over one story like today. Rural locations today

Site Factor: Capital

area familiar with type of industry = easier to borrow money

Central Europe

US outsource to:

human resources

Agglomeration

Similar industries benefit from factories nearby

-silicon valley

-hospitals near each other

outsourcing

moving individual steps in the production process to a supplier, who offers a cost savings

offshoring

outsourced work that is located outside of the country

right to work law

work must maintain “open-shop”, close shops are illegal

Close shop: everyone who works in the company is in a union. Part of salary is taken out to pay union fee

Open shop: union is optional

Where is Industry Expanding?

Large movement to the S and W

China

cheap labor and cheap consumer

SEZ- China

special tax incentives for foreign investments, mostly in populated areas, not for china’s benefits

America outsourcing

Pros: competitive, low labor costs, more ideas, frees up time

Cons: lost of control over process (Apple), sluggish response times, irate customer base, lost of company culture (loyalty)

India outsourcing

Pros: role for women, better-paying jobs, undermines caste system

Cons: discourages home growth, lost of culture (holidays, work culture, social norms), destroys small business, tradition vanishes

Fordist

each worker performs one task only

Multiplier effect

growth of something around something else

Economics of scale

cost advantages reaped by customers when production became efficient

increasing cost, lowering production

growth poles

agglomeration of high tech companies

Complementary trade

trade is greater if each side has something the other wants or needs

countries trading specialites with each other

Comparative advantages

one trade partner might be better at producing agricultural goods, while the other partner might be better at manufacturing products. Each will specialize at what they are good at

suburban sprawl

• more miles for private transport in suburbs

• more expensive pricing for houses

• poverty in small urban areas

• core cities paying more for services that are consumed by whole region but only paid by core residents

• retail shops moving to suburbs

reverse commuting

city to suburbs

• malls moving out, jobs are further away

gated communities

• residential segregation: low-income people cannot purchase homes or travel without invitation here

megalopolis

cities combining into one

motor vehicles

pros:

• comfort, choice, flexibility

• low perceived cost

cons:

• consumption of land

• traffic congestion

social and physical challenges

underclass resident of inner cities

• inadequate job skills

• culture of poverty

• homelessness

• drugs

• crime

• filtering

filtering

housing unit becomes more affordable by age

old houses will become cheaper compared to new houses

pro if enough housing

con if shortage